Daily News | Feds file first criminal charges against Par Funding principal in long-running financial fraud probe
A former official at an embattled Philadelphia-based business lender is expected to admit in court Wednesday that he and the company’s other principals defrauded hundreds of investors with promises of double-digit returns on loans to companies deemed too risky to borrow from traditional banks.
No charges have been filed against them, and attorneys for the three did not return calls seeking comment this week.A grand jury continues to hear evidence in the case and attorneys representing Par Funding’s investors, who have been working with federal authorities, said they expected charges against other senior officials to emerge soon.
From its offices in Old City, prosecutors say, the company raised more than half a billion dollars between 2016 and 2021 by making “materially false and fraudulent” statements to investors about the safety of their money, and the true identity of Par Funding’s top management, while they lent it out to small businesses across the country on terms that, if fully paid, would have cost several times what they borrowed.
Prosecutors say Abbonizio and the others also kept investors in the dark about who was running Par Funding day-to-day., but investigators say she rarely set foot in the office and instead served as a proxy for her husband, LaForte. He was legally barred from selling securities, due to felony convictions in 2006 for a $14 million real estate Ponzi scheme, and in 2009 for operating an illegal offshore gambling operation.
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